Many potential landlords and investors are afraid. They’re afraid of tenants. Tenants might trash the house, run away without paying rent, and leave a mass of junk and dirt behind. It happens, and it happens a lot. But don’t let the TV shows fool you – you can find the right tenants for your property with a little effort.
First of all, we have to remember that a lot of these problems occur in areas where we expect problems. Unemployment might be high, house prices could be very low, and individual investors may not even be from the area. Rent may be provided via housing benefits. These are the areas in which the horror stories and TV shows come from. Investing in the right market makes a huge difference. Looking for a stable market with strong house prices and good local amenities will really improve the chances of finding a good tenant.
Once you’ve invested, you’re still not out of the woods! You have to find the tenant that you believe is going to be the least hassle, but that can be tricky. Agents will offer a number of services to help, including credit and tenancy referencing. These go some way to showing that a potential tenant has good credit, and has a good track record of renting (if they’ve rented before). But do these two indicators alone give you a good overview of your potential tenants and how the tenancy might go? I’m not so sure…
I find that spending time with any potential tenant, as well as potential landlords, is the most valuable tool at my disposal. I strive to get to know the person I’m working with, and I get to understand their situation in more detail. Sometimes references show someone in a bad light, but do not accurately reflect their real background or recent history. By working with individual people, you can discover the real stories behind the paperwork, and this helps me to introduce the right tenants to the right landlords.
Some agencies, especially sales agencies, are too focussed on getting applications for properties no matter who it might be applying. Often the people applying don’t even fit a landlords’ criteria. Do sales agents have the time or the inclination to have discussions with potential applicants? From my experience the answer is “no”! Traditional agencies are too focussed on sales, and even lettings agents are focussed on getting numbers through your doors to make it look like they have a glut of applicants waiting to sign on the dotted line. Rarely do these agencies bring 1, 2 or 3 carefully vetted applicants along, knowing that these people will be great tenants for a long period of time.
Whether you’re a landlord, an investor, or simply looking at getting into the buy-to-let market, don’t be afraid! Perfect tenants are out there! Making your agent work for you is key – ignore the sales pitches and find out how they’re adding value for you.